We may vote against certain directors where changes to governing documents are not put to a shareholder vote within a reasonable period of time, particularly if those changes have the potential to impact shareholder rights (see Director elections). In our view, shareholders should be entitled to voting rights in proportion to their economic interests. We encourage companies to ensure that their compensation plans incorporate appropriate and rigorous performance metrics, consistent with corporate strategy and market practice. 0000110450 00000 n 0000013331 00000 n Examples of environmental issues include, but are not limited to, water use, land use, waste management, and climate risk. Examples of social issues include, but are not limited to, human capital management, impacts on the communities in which a company operates, customer loyalty, and relationships with regulators. Where a company is listed on multiple exchanges or incorporated in a country different from their primary listing, we will seek to apply the most relevant market guideline(s) to our analysis of the companys governance structure and specific proposals on the shareholder meeting agenda. Where we determine that a board has not acted in the best interests of the companys shareholders, or takes action to unreasonably limit shareholder rights, we may vote against the appropriate committees and/or individual directors. WebProxy Voting Guidelines. While we will typically support proposals requesting board de-classification, we may make exceptions, should the board articulate an appropriate strategic rationale for a classified board structure. Accordingly, shareholders should have the right to call a special meeting in cases where a reasonably high proportion of shareholders (typically a minimum of 15% but no higher than 25%) are required to agree to such a meeting before it is called. C O M 6 of 17 Upcoming Milestones Early-Mid December: Publication of all updated ISS benchmark policies (proxy voting guidelines) for 2023 on ISS website. At this stage, we view Scope 3 emissions differently from Scopes 1 and 2, given methodological complexity, regulatory uncertainty, concerns about double-counting, and lack of direct control by companies. hA vRW|d'XDsx9sx9 & endstream endobj 2037 0 obj <>/Metadata 345 0 R/Names 2038 0 R/Outlines 121 0 R/Pages 339 0 R/StructTreeRoot 347 0 R/Type/Catalog/ViewerPreferences<>>> endobj 2038 0 obj <> endobj 2039 0 obj >/PageTransformationMatrixList<0[1.0 0.0 0.0 1.0 -306.0 -396.0]>>/PageUIDList<0 544>>/PageWidthList<0 612.0>>>>>>/Resources<>/ExtGState<>/Font<>/ProcSet[/PDF/Text/ImageC]/XObject<>>>/Rotate 0/StructParents 0/Thumb 307 0 R/TrimBox[0.0 0.0 612.0 792.0]/Type/Page>> endobj 2040 0 obj <> endobj 2041 0 obj <>stream Where a company has failed to appropriately provide robust disclosures and evidence of effective business practices, BIS may express concerns through our engagement and voting. We look for disclosures from companies to help us understand their approach and do not prescribe any particular board composition. Continue to $country-name$ Individual Investor site. Voting Process The Proxy Committee has approved proxy voting guidelines applicable to specific types of common proxy proposals (the Approved Guidelines). While we welcome any disclosures and commitments companies choose to make regarding Scope 3 emissions, we recognize that these are provided on a good-faith basis as methodology develops. The roles and responsibilities cited here are not all-encompassing and are noted for reference as to how these leadership positions may be defined. These clauses also tend to specify that an all-cash bid for all shares that includes a fairness opinion and evidence of financing does not trigger the pill, but forces either a special meeting at which the offer is put to a shareholder vote or requires the board to seek the written consent of shareholders, where shareholders could rescind the pill at their discretion. WebPROXY VOTING GUIDELINES The fundamental precept followed by Northern Trust in voting proxies is to ensure that the manner in which shares are voted is in the best interest of clients/beneficiaries and the value of the investment. An EGC should have an independent audit committee by the first anniversary of its IPO, with our standard approach to voting on auditors and audit-related issues applicable in full for an EGC on the first anniversary of its IPO. Where discretion has been used by the compensation committee, we look for disclosures relating to how and why the discretion was used and how the adjusted outcome is aligned with the interests of shareholders. BIS may take voting action against directors (up to and including the full board) where those actions are viewed as egregiously infringing on shareholder rights. It is our view that well-run companies, where appropriate, effectively evaluate and manage material sustainability-related risks and opportunities[12] as a core component of their long-term value creation for shareholder and business strategy. Payouts to executives should reflect both the executives contributions to the companys ongoing success, as well as exogenous factors that impacted shareholder value. Proposals to change a corporations form, including those to convert to a public benefit corporation (PBC) structure, should clearly articulate the stakeholder groups the company seeks to benefit and provide detail on how the interests of shareholders would be augmented or adversely affected with the change to a PBC. It allows boards to have deeper discussions and make more resilient decisions. A growing number of companies, financial institutions, as well as governments, have committed to advancing decarbonization in line with the Paris Agreement. We hold members of the compensation committee, or equivalent board members, accountable for poor compensation practices and/or structures. In determining how to vote on behalf of clients who have authorized us to do so, we look to companies only to address issues within their control and do not anticipate that they will address matters that are the domain of public policy. In exceptional circumstances and with sufficiently broad support, shareholders should have the opportunity to raise issues of substantial importance without having to wait for management to schedule a meeting. The administration of these MFS Proxy Voting Policies and Procedures is overseen by the MFS Proxy Voting Committee, which Specifically, we look for companies to disclose strategies that they have in place that mitigate and are resilient to any material risks to their long-term business model associated with a range of climate-related scenarios, including a scenario in which global warming is limited to well below 2C, and considering global ambitions to achieve a limit of 1.5C. We may decide to support a shareholder proposal requesting additional disclosures if we identify a material inconsistency or feel that further transparency may clarify how the companys political activities support its long-term strategy. Our evaluation of equity compensation plans is based on a companys executive pay and performance relative to peers and whether the plan plays a significant role in a pay-for-performance disconnect. However, the final voting decision is independent and voting authority rests BIS recognizes the critical importance of financial statements to provide a complete and accurate portrayal of a companys financial condition. As a result, BlackRock will generally not participate in consent solicitations or related processes. We generally support reverse stock splits that are designed to avoid delisting or to facilitate trading in the stock, where the reverse split will not have a negative impact on share value (e.g., one class is reduced while others remain at pre-split levels). jxD NyA%oIL.Mr`sjk BCy +MX |. |_j l3 endstream endobj 2075 0 obj <>/Filter/FlateDecode/Index[347 1689]/Length 63/Size 2036/Type/XRef/W[1 2 1]>>stream }mA$ffSDYnbN|d=,AHsNz8L s endstream endobj 2042 0 obj [/ICCBased 2047 0 R] endobj 2043 0 obj <>stream Compensation structures should generally drive outcomes that align the pay of the executives with performance of the company and the value received by shareholders. I S S G O V E R N A N C E . The most common form of ESPP qualifies for favorable tax treatment under Section 423of the Internal Revenue Code. Common circumstances are illustrated below: In addition, we recognize that board leadership roles may vary in responsibility and time requirements in different markets around the world. In addition, all members of audit, compensation, and nominating/governance committees should be independent. We encourage companies to provide transparency around risk management, mitigation, and reporting to the board. However, once an item comes to a shareholder vote, we uphold our fiduciary duty to vote in the best long-term interests of our clients, where we are authorized to do so. This and other important informationiscontained in a Fund's prospectus and summary prospectus. In our view, an informative indicator of diversity for such companies is having at least two women and a director who identifies as a member of an underrepresented group. 0000015236 00000 n Who may vote: If you owned shares of RTX Common Stock at the close of business on March 7, 2023, you are entitled to receive this Notice of the 2023 Annual Meeting and to vote at the meeting, either during the virtual meeting or by proxy. WebName of proxy vote by the homeowners association during the _____ meeting. We may oppose shareholder proposals requesting the right to act by written consent in cases where the proposal is structured for the benefit of a dominant shareholder to the exclusion of others, or if the proposal is written to discourage the board from incorporating appropriate mechanisms to avoid the waste of corporate resources when establishing a right to act by written consent. WebIn the first half of 2022, we updated our proxy voting guidelines to enhance our commitments in three key areas: Board diversity, climate-related accountability, and cross-shareholding. 0000012069 00000 n WebGlass Lewis 2023 Proxy Voting Policy Guidelines are now available for the United States and Canada, Continental Europe, the UK, and ESG. We oppose voting on matters where we are not given the opportunity to review and understand those measures and carry out an appropriate level of shareholder oversight. Shareholders should have the right to vote on key corporate governance matters, including changes to governance mechanisms and amendments to the charter/articles/bylaws. We support incentive plans that foster the sustainable achievement of results both financial and nonfinancial consistent with the companys strategic initiatives. Where a poison pill is put to a shareholder vote by management, our policy is to examine these plans individually. The materials on this website are for illustration and discussion purposes only and do not constitute an offering. Foreign investing, especially in developing countries, has special risks such as currency and market volatility and political Foreign investing, especially in developing countries, has special risks such as currency and market volatility and political and social instability. Where a director serves on an excessive number of boards, which may limit their capacity to focus on each boards needs, we may vote against that individual. Review details of firms position on all major proxy voting issues. In our view, a strong board provides a competitive advantage to a company, providing valuable oversight and contributing to the most important management decisions that support long-term financial performance. The compensation committee should carefully consider the specific circumstances of the company and the key individuals the board is focused on incentivizing. %PDF-1.5 % (go back), 13The International Financial Reporting Standards (IFRS) Foundation announced in November 2021 the formation of an International Sustainability Standards Board (ISSB) to develop a comprehensive global baseline of high-quality sustainability disclosure standards to meet investors information needs. These guidelines provide an overview of how ISS approaches proxy voting issues for subscribers of the Sustainability Policy. We will evaluate these disclosures to inform our view of how a company is managing material nature-related risks and opportunities, as well as in our assessment of relevant shareholder proposals. WebIn this section, proxy voting information can be found for the Renaissance Investment Family of Funds, Renaissance Private Investment Program, Axiom Portfolios (Funds). In our letter on unequal voting structures, we articulate our view that one vote for one share is the preferred structure for publicly-traded companies. Proxy access mechanisms should provide shareholders with a reasonable opportunity to use this right without stipulating overly restrictive or onerous parameters for use, and also provide assurances that the mechanism will not be subject to abuse by short-term investors, investors without a substantial investment in the company, or investors seeking to take control of the board. However, we may oppose this right in cases where the proposal is structured for the benefit of a dominant shareholder, or where a lower threshold may lead to an ineffective use of corporate resources. Comprehensive disclosures provide investors with a sense of the companys long-term risk management practices and, more broadly, the quality of the boards oversight. We generally support proposals to increase or issue preferred stock in cases where the company specifies the voting, dividend, conversion, and other rights of such stock and where the terms of the preferred stock appear reasonable. RBC GAM subscribes to the research of both ISS and Glass, Lewis & Co . 0000012287 00000 n We will evaluate the actions that the company has taken to limit shareholders ability to exercise the right to nominate dissident director candidates, including those actions taken absent the immediate threat of a contested situation. For companies facing insolvency or bankruptcy, a premium may not apply, There should be clear strategic, operational, and/or financial rationale for the combination, Unanimous board approval and arms-length negotiations are preferred. Individual proxy votes therefore will differ from these guidelines from time to time. There may be legitimate instances where underwater options create an overhang on a companys capital structure and a repricing or option exchange may be warranted. For example, we recognize that topics around taxation and tax reporting are within the domain of local, state, and federal authorities. While these meetings have traditionally been conducted in-person, virtual meetings are an increasingly viable way for companies to utilize technology to facilitate shareholder accessibility, inclusiveness, and cost efficiencies. We will consider whether the transaction involves a dissenting board or does not appear to be the result of an arms-length bidding process. We generally do not support shareholder proposals seeking the reimbursement of proxy contest expenses, even in situations where we support the shareholder campaign. We also generally oppose plans that allow for repricing without shareholder approval. BIS recognizes that climate change can be challenging for many companies, as they seek to drive long-term value by mitigating risks and capturing opportunities. They are to be applied with discretion, taking into consideration the range of issues and facts specific to the company, as well as individual ballot items at shareholder meetings. We encourage disclosures aligned with the reporting framework developed by the Task Force on Climate related Financial Disclosures (TCFD), supported by industry-specific metrics, such as those identified by the Sustainability Accounting Standards Board (SASB), now part of the International Sustainability Standards Board (ISSB) under the International Financial Reporting Standards (IFRS)Foundation. BIS will also consider the average board tenure to evaluate processes for board renewal. We typically support shareholder proposals on these matters unless the company already has a robust clawback policy that sufficiently addresses our concerns. The proposal should give unaffiliated shareholders the opportunity to affirm the current structure or establish mechanisms to end or phase out controlling structures at the appropriate time, while minimizing costs to shareholders. It is our view that climate change has become a key factor in many companies long-term prospects. Where we find that shareholder protections are diminished, we may support reincorporation if we determine that the overall benefits outweigh the diminished rights. In general, we support market-standardized proxy access proposals, which allow a shareholder (or group of up to 20 shareholders) holding three percent of a companys outstanding shares for at least three years the right to nominate the greater of up to two directors or 20% of the board. These Guidelines are not intended to limit the analysis of individual issues at specific companies or provide a guide to how BIS will engage and/or vote in every instance. Investments are not FDIC-insured, nor are they deposits of or guaranteed by any bank or any other entity. The following issue-specific proxy voting guidelines (the Guidelines) summarize BlackRock Investment Stewardships (BIS) philosophy and approach to engagement and voting, as well as our view of governance best practices and the roles and responsibilities of boards and directors for publicly listed U.S. companies. Where companies are unwilling to voluntarily implement one share, one vote within a specified timeframe, or are unresponsive to shareholder feedback for change over time, we generally support shareholder proposals to recapitalize stock into a single voting class. We will review a proposed transaction to determine the degree to which it has the potential to enhance long-term shareholder value. We note that majority voting may not be appropriate in all circumstances, for example, in the context of a contested election, or for majority-controlled companies or those with concentrated ownership structures. 0000033519 00000 n &/%C`6c l`T8N! This includes, but is not limited to, settlement agreements arising from such behavior and paid for directly by the company. We generally view the boards discretion to establish voting rights on a when-issued basis as a potential anti-takeover device, as it affords the board the ability to place a block of stock with an investor sympathetic to management, thereby foiling a takeover bid without a shareholder vote. Introducing the possibility of such reimbursement may incentivize disruptive and unnecessary shareholder campaigns. Our publicly available commentary provides more information on our approach to board diversity. We will evaluate these instances on a case-by-case basis. BIS may support shareholder proposals requesting to put extraordinary benefits contained in supplemental executive retirement plans (SERP) to a shareholder vote unless the companys executive pension plans do not contain excessive benefits beyond what is offered under employee-wide plans. The information on this website does not constitute an offer to sell, or a solicitation of an offer to purchase, securities in any jurisdiction to any person to whom it is not lawful to make such an offer. We encourage boards to disclose their approach to evaluations, including objectives of the evaluation; if an external party conducts the evaluation; the frequency of the evaluations; and, whether that evaluation occurs on an individual director basis. Compensation committees should guard against contractual arrangements that would entitle executives to material compensation for early termination of their contract. Please read the prospectus and summary prospectus carefully before investing. WebIn the exercise of proxy voting authority which has been delegated to it by particular clients, the Advisor will apply the following policies in accordance with, and subject to, any 0000013250 00000 n We generally favor a simple majority voting requirement to pass proposals. We may support these proposals when they are consistent with our views as described above. The views and strategies described may not be suitable for all investors. (go back), 17https://www.blackrock.com/corporate/literature/whitepaper/bii-managing-the-net-zero-transition-february-2022.pdf(go back), 18While guidance is still under development for a unified disclosure framework related to natural capital, the emerging recommendations of the Taskforce on Nature-related Financial Disclosures (TNFD), may prove useful to some companies. 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